Mastek Confident Of Achieving 17% Operating Margins In First Half Of FY26
Mastek CEO Umang Nahata said while margins have been steady, the company will build it up from hereon.
Mastek Ltd. is confident of “easily” moving its operating margins upwards of 17% in the next two or three quarters, the company’s new Chief Executive Officer, Umang Nahata, told NDTV Profit.
The company reported a dip of 85 basis points in its operating margins in Q3 on a year-on-year basis. The figure contracted to 16.2% in the December quarter, as compared to 17% in the corresponding quarter of the previous month.
Talking to NDTV Profit, Nahata, who was appointed Mastek CEO on Jan. 16, was optimistic about growth prospects. “On the margin performance side, we have been steady and our endeavour is to start building from here,” he said.
Mastek is “definitely looking forward to improving” its operational margins from the current quarter, Nahata mentioned.
“We are not happy with the 16%-16.5% (margins). We think we can easily move them to 17% or north of 17% in the coming two or three quarters,” he said.
The CEO stated that his company was taking necessary steps to improve the margins, including focusing on AI-driven efficiency.
“We are running all of our endeavours to it. AI-driven efficiency is also a key part of driving that operational margin, and we're already seeing moving up clients…So we will see some operating levers as far as operational efficiency is concerned,” he said.
On the revenue front, Mastek is eyeing “steady topline growth,” according to Nahata.
“Our UK business will end up with a very strong order backlog. Therefore, we'll see a healthy topline growth as we go in the next quarter,” he said.
Mastek closed Q3 with an order backlog of $250 million, its CEO said.
“Post the close of the quarter, we have locked another deal of around $40 million in the last few days,” Nahata revealed.
“So that's $270-280 million worth of orders that we have to execute over the next 12 months. As we go into Q4, we are pretty confident that our order backlog will substantially grow from here,” he explained.
Shares of Mastek Ltd. dipped over 3.5% during intraday trade on the NSE on Friday to touch a low of Rs 2,644.45 apiece. The stock was trading in red at Rs 2,735.50 at 12:35 p.m. , while benchmark Nifty 50 was down 0.38% at 23,222.70 points.
